Model-year 2007 a hot seller for metric dealers

January 7, 2013

By Dave McMahon

ADP Lightspeed study shows 2006 models top V-twin used sales

In a study of the model year of used motorcycle sales in 2012 provided exclusively to Powersports Business, ADP Lightspeed analyst Hal Ethington finds that the most prevalent model year of used V-twin units sold in the U.S. during 2011 and 2012 was two years newer than that of used units sold by metric dealers in the same time period.

In Canada, used metric units sold are one to two years newer than used metric U.S. units, and the major model year of used V-twin unit sales in Canada is on average one year older than those pre-owned V-twin units sold in the U.S.

The survey among ADP Lightspeed dealers included more than 232,000 pre-owned units sold in the U.S. and Canada during 2011 and 2012. Results on the accompanying charts are expressed as a percentage of unit counts, not as a percentage of sales dollars. Model years 2012 and those older than 2000 were excluded from this study.

Here’s how Ethington breaks down his findings:

Finding 1:
“We see that in 2011, four-year-old model year 2007s dominated the U.S. metric market with 18 percent of units sold (Chart A). With a differential of 5 percentage points between 2006 models, and 3 points between 2008 models, this is the largest difference in any of the focal points studied, which were usually within 4 points of each other.”

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Finding 2:
“In both the metric and V-twin U.S. markets, the average age of used units sold went up (older) by two years in 2012 (Charts B and D). This is a surprising finding, indicating that perhaps economic factors above and beyond normal market activity may have influenced sales. We would normally expect to see the age of used units remaining at a constant difference behind new. But here, we see that age difference growing by two years, as units go back one year, while the calendar advanced by one year.”

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Finding 3:
“The majority of used U.S. V-twin units are grouped tightly between three model years in both 2011 and 2012 (Charts C and D). The difference between the three top years is only 0.6 percentage points in 2011, and 0.4 percentage points in 2012. However, U.S. metric models varied by as much as 5 full percentage points during this same time, indicating a much wider age-range of popular used units (Charts A and B).”

Finding 4:
“U.S. metric dealers will note that the majority of used units average 4.5 years old at the time of sale. For Canadian dealers the average is
4.0 years. For both the U.S. and Canadian V-twin markets, the average is 4.0 years. These averages are not weighted, but rather derived as the average of the top three model years in each of the two years studied.”

Ethington notes that unit counts between years and markets cannot be taken as a measure of volume, or any change in volume. The sample was not audited to see if the same dealers were represented in both years, rendering volume measurements meaningless. However, the count of units in the various model years as a percent of the total sold is mathematically reliable since the sample contains more than 200,000 units.

“Dealers will quickly see that the probability of selling a unit older than six years exists, but it is significantly less than that for units manufactured in the most recent six model years,” Ethington said. “A slightly larger window of opportunity does exist for U.S. metric units, but conservative trade guidelines would probably not consider this as an additional opportunity.

“Reconditioning costs, time of year, selling price of the new unit involved in the trade and current used unit inventory levels are all considerations of accepting a trade that must be considered. But this study does add additional insight into the used bike market, and may provide used managers with greater understanding of what will move quickly, and what might not.”